shanecurran
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| Perpetuation of wealth |
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Should we allow the perpetuation of wealth through generations?
From a philosophical point of view, should someone be born into wealth? If so, how are wealthy families different from royalty in the old world?
From an economic point of view, would higher taxes on inheritance increase productivity and efficiency?
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Tue Apr 19, 2011 9:12 pm |
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shanecurran
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I believe a decedent should be able to pass up to $5 Million to each heir of their choice tax free. All leftover money can either be donated to a charity of their choosing, or will be split evenly between all other tax paying individuals in the US.
For example lets say there are 200 million tax paying individuals. I have $205 million and one son (who is my only heir). I can give him $5M tax free. The other $200M can either go to a charity or charities of my choosing or they will be split evenly between 200 million tax paying individuals in which case everyone would get $1.
Philosophically I do not believe anyone should be born into wealth.
I believe my proposal would increase efficiency as well, because there would be more incentive to work by individuals who may not have done so otherwise. It would also boost the economy because more money would be spent as individuals who hold the money would have a higher average propensity to consume than the heir.
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Tue Apr 19, 2011 9:21 pm |
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coaster
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Here's where you and I will have to disagree. Several quick points:
1) it should be up to the individual what they want to do with their wealth: pass it on, donate it, whatever. (Philosophically I don't believe anyone should be told what to do with their money)
2) Having some good-for-nothing rich people's kids squandering their inherited wealth is a good thing to have around as an object example
3) Not all inheritors of wealth are lazy good-for-nothings. Rockefeller's kids, and many others were able to do many great and good things with their inherited money. And, as a matter of fact, I personally know one very wealthy individual from a wealthy family who took none of his inherited money and made his own fortune.
4) You don't really think the government (who else would get the money?) would do any better with it than the rich people's kids?
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Wed Apr 20, 2011 6:54 am |
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shanecurran
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1) They can do whatever they want with their money while they are alive.
3) I don't believe the heirs are lazy good-for-nothings. In fact I believe this is probably more of the exception than the rule. If you are great then you can still do great. $5M is an enormous windfall, not to mention the privileges the heirs no doubt already experienced (well traveled, cultured, better schools, networking etc.) If they are truly as great as you propose, then they will still do great. Weather or not the heir decides to take the money is irrelevant to the argument.
4) The government does not receive the money. The money goes to charity or is divided equally among all tax filers from the previous year.
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Wed Apr 20, 2011 2:21 pm |
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oldguy
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quote:
Philosophically I do not believe anyone should be born into wealth.
Maybe, but that is for me to decide, not Obama. When you consider whether to gift each grandkid $100,000 you wrestle with how does it affect their lives, what should the timing be, etc. If an 18-yr-old gets (1) $100k, or (2) a promise of $100K at age 30, he has to decide whether to bother with college, whether to blow the $100k on toys, whether to use it wisely, invest it, start a business, yada. Live big and wait for the 30-yr-old windfall to save him? Literally, any one of their decisions, good or bad, has an effect on his entire life, how he lives, how/when he dies. So you take on a HUGE responsibility for people's lives when you make the decision - and doing nothing is an equally big deciison - ie, you can't duck it. And, IMO, wishing for a Law that prevents it is a way of ducking it.
Each of us needs to take the responsibilty for our lifes accumulated wealth - spend/dissipate it, gift it, leave it to heirs, leave it to charity, etc. But each of us needs to make that decision, government intervention is, for the most part, unneeded.
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Wed Apr 20, 2011 3:57 pm |
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shanecurran
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quote:
Originally posted by oldguy
quote:
Philosophically I do not believe anyone should be born into wealth.
Each of us needs to take the responsibilty for our lifes accumulated wealth - spend/dissipate it, gift it, leave it to heirs, leave it to charity, etc. But each of us needs to make that decision, government intervention is, for the most part, unneeded.
So you disagree with the idea philosophically? Do you think it would be better for the economy?
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Wed Apr 20, 2011 5:14 pm |
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littleroc02us
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| Re: Perpetuation of wealth |
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quote:
Originally posted by shanecurran
Should we allow the perpetuation of wealth through generations?
From a philosophical point of view, should someone be born into wealth? If so, how are wealthy families different from royalty in the old world?
From an economic point of view, would higher taxes on inheritance increase productivity and efficiency?
Since when is our business to tell people what to do with their wealth, whether it be through family inheritance or other? What kind of a country would that be? Are people so worried about other people money that they just get jealous and caught up with it. I don't want this country to turn into communist China where the wealth is distributed to all for the common good. I don't believe in an inheritance tax, because if I'm not mistaken weren't they already taxed on it???? Can anyone say "Double Dipping!"
Romans 13:8 “Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law.”
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Wed Apr 20, 2011 5:48 pm |
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littleroc02us
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quote:
Originally posted by shanecurran
I believe a decedent should be able to pass up to $5 Million to each heir of their choice tax free. All leftover money can either be donated to a charity of their choosing, or will be split evenly between all other tax paying individuals in the US.
What? So what business would you have taking someone else's wealth that you didn't earn? It's not yours.
Romans 13:8 “Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law.”
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Wed Apr 20, 2011 5:51 pm |
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shanecurran
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quote:
Originally posted by littleroc02us
What? So what business would you have taking someone else's wealth that you didn't earn? It's not yours.
Exactly right. It was not earned by the heir, it is not their money. Why should they get the money? Think about it.
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Wed Apr 20, 2011 5:59 pm |
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oldguy
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quote:
So you disagree with the idea philosophically? Do you think it would be better for the economy?
Some heirs will spend it on toys. Some heirs will increase the size of a family business substantially - both stimulate the economy. Or, if the govt takes it as a tax, it goes to social programs, etc - and also stimulates the economy. But govt doesn't produce anything, so the money goes to dissipative uses rather than going to factories and producing goods and services. Hard to guess which has a better effect on the economy - and the timing of the economy.
One negative to the taxation concept - it decentivizes production. Many people work/save to leave a legacy to heirs. If that motivation is removed, there is no point to earning that last couple of million, just retire early and hit the beach.
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Wed Apr 20, 2011 6:06 pm |
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littleroc02us
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quote:
Originally posted by shanecurran
quote:
Originally posted by littleroc02us
What? So what business would you have taking someone else's wealth that you didn't earn? It's not yours.
Exactly right. It was not earned by the heir, it is not their money. Why should they get the money? Think about it.
If the heir gives it to someone it's theirs isn't it? The person who earns the money can do whatever they want with it. They could put it all in a burning pit and light a match to it if they want. The point is that it's their money, not yours unless they give it to you.
Romans 13:8 “Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law.”
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Wed Apr 20, 2011 6:09 pm |
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littleroc02us
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If the Gov't ever starts taking my money that I earn when I die and I cannot leave it to my blood relatives, then it will be all spent or donated at my will before I die.
Romans 13:8 “Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law.”
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Wed Apr 20, 2011 6:11 pm |
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littleroc02us
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Exactly right. It was not earned by the heir, it is not their money. Why should they get the money? Think about it.[/quote]
One word. Inheritance.
Romans 13:8 “Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law.”
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Wed Apr 20, 2011 6:12 pm |
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littleroc02us
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I just thought of a good analogy, so if we go with your ideas that once a person dies who is wealthy that that no one should inherit the money, then what would you do with the family farm that is passed on to the son who didn't buy it, doesn't own it and just works there and wants to continue the family business? Should the farm have to be sold and then the money distributed to the citizens?
Romans 13:8 “Owe no man any thing, but to love one another: for he that loveth another hath fulfilled the law.”
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Wed Apr 20, 2011 6:15 pm |
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shanecurran
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quote:
Originally posted by littleroc02us
If the heir gives it to someone it's theirs isn't it? The person who earns the money can do whatever they want with it. They could put it all in a burning pit and light a match to it if they want. The point is that it's their money, not yours unless they give it to you.
They can do whatever they want with the money while they are alive. If they want to burn it, that is their prerogative.
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Wed Apr 20, 2011 6:19 pm |
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